WA: Shareholder or officer of closely held corp has no personal privacy interest in corporate records under state constitution

“Paul Chase, shareholder and principal officer of Red Leaf Construction Inc., appeals the trial court’s partial denial of his motion to suppress Red Leaf’s bank records. A commissioner of this court granted discretionary review. We consider, as a matter of first impression, whether a shareholder or officer of a closely held corporation has a personal privacy interest in the corporation’s financial information. We hold that neither has this personal privacy interest and affirm.” State v. Chase, 2017 Wash. App. LEXIS 2935 (Dec. 26, 2017) (state constitution):

¶13 This court must therefore decide, as an issue of first impression, whether a corporate officer has a personal privacy interest in the corporation’s financial transactions described in its bank records. To determine “whether a particular expectation of privacy is one that a citizen of this state should be entitled to hold,” this court must engage in a two-part inquiry.

¶14 First, we must examine whether the interest has been protected historically as part of an individual’s private affairs. For example, in State v. McKinney, the Washington Supreme Court analyzed a 1937 statute that created the Department of Licensing (DOL) and required it to maintain vehicle ownership and licensing information. Anyone could obtain vehicle registration information until the legislature amended the statute in 1990. The 1990 amendment narrowed public access to information from the DOL but did not restrict release of information to law enforcement. The court held that “[o]ur historical review of driver’s license records does not support a conclusion that DOL licensing records constitute ‘private affairs.’”

¶15 Second, we must consider the nature and extent of the information that may be obtained by the challenged government conduct. …

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